In describing the problems facing GM and the other auto makers, Ali Velshi the CNN economics commentator, mentioned one of the big issues is the heavy pension load the car manufacturers are carrying.
Pensions are not a gift to workers, they are deferred compensation. If the auto manufactures had not offered pensions, they would have had to pay a higher hourly wage. The cost of the pension was figured into the labor cost for the cars or components built by that worker and included in the sale price of the individual cars.
Now the auto makers are claiming that paying the pension with money they already have, the money that was collected when the cars were sold, will break them.
I don’t know what the answer is, but stealing from the auto manufacturers’ former employees sure isn’t it!
My argument with the news media is that they don’t educate their viewers and readers by reporting the the true facts.
1. The workers already earned the money represented by the pension
2. The companies already collected the money that should pay for the pensions
3. Not paying the pensions is exactly the same your not paying for gas after you fill your car’s tank
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